What Happened to the Peace Corps?

Two Peace Corps volunteers turned critics claim the agency needs sweeping reforms, but that it is expanding its ranks instead without listening to mounting complaints from its existing volunteers, or addressing a drop-out rate of more than 30 percent.

Chuck Ludlam and his wife Paula Hirshoff say the Peace Corps has lost its way since its founding by JFK 50 years ago.

"We're sad about it but we're also angry about it," Ludlam told ABC News, "because the people in these countries need our help. And the Peace Corps could be a great force for good in the world in terms of development assistance."

Ludlam and Hirschoff were both volunteers in the 1960s and then returned to serve together in Senegal from 2005 to 2007. Ludlam was also an advisor to the Obama/Biden Peace Corps transition team and a board member of the volunteers' alumni group, the National Peace Corps Association.

But in the past few years, as the Peace Corps has been slowly increasing the size of its volunteer force, both have become leading critics of the agency. According to Hirschoff, there would be more public questioning of the Peace Corps if nostalgia didn't make so many returned volunteers hesitate before speaking up.

"I think it's somewhat immune from criticism partly because it is part of the John F. Kennedy legacy, but also because many volunteers from the '60s and '70s are nostalgic about their own experiences," said Hirschoff. "They don't want to criticize the Peace Corps. It might feel like their own experience is being criticized."

"We were like that too before we went back and saw some of the problems up close," said Hirschoff.

WATCH THE 20/20 REPORT ON THE PEACE CORPS BY CLICKING THE FOLLOWING: PART 1, PART 2, PART 3

After their second stint in the Peace Corps, Ludlam and Hirschoff came to believe the agency was plagued by incompetent country directors, poor management, inadequate training, rapid turnover and a culture that discourages volunteers from bringing problems to the attention of their superiors.

Ludlam said he obtained surveys completed by volunteers in sites around the world from a whistleblower with Peace Corps headquarters in Washington. The results, he said showed that there are vast discrepancies between programs.

Ludlam claims the surveyed volunteers gave "terrible" ratings to country directors in three dozen countries. The Peace Corps currently has about 8,600 volunteers in 77 nations. "It turned out that maybe 15 of the countries were well-managed and the rest of them were poorly managed," said Ludlam.

"There are some wonderful programs," said Ludlam, "there are some wonderful managers, but there is a lot of rot in the agency, and you have to be careful if you join up."

Ludlam argues that the rapid turnover of volunteers stunts the growth of potentially good programs.

"The volunteers go to their sites and they basically start from scratch. There's no book on what's happened at that site before," said Ludlam.

"This is not a serious effort at development," he added.

"We could get things done," he said, referring to himself and his wife Paula, who served their second stint after retiring. "But the younger volunteers, for them, that's basically their first job. They're straight out of school by and large. And when you have poor training, poor sites, poorly designed programs, poor support -- they really get hurt by it. They're disillusioned. And that's why so many of 'em leave early."

Peace Corps: 'We Do an Investigation' When Many Volunteers Drop Out

The Peace Corps says that it has an annual drop-out rate of about 10 percent, based on how many volunteers drop out in a given year versus the total number of volunteers serving that year. The current number of volunteers represents an increase of under a thousand from past yearly totals, following a push by the Obama administration to expand the ranks.

Ludlam says the true drop-out rate is closer to a third, if one calculates it based on how many volunteers don't finish their full term of service. Each volunteer commits to three months of in-country training and 24 months of service, and some volunteers elect to extend their service.

Ludlam bases his claim on the research of returned Peace Corps volunteer Mike Sheppard, who served in the Gambia from 2003 to 2005 and then entered graduate school for statistics at Michigan State. Sheppard, now a full-time researcher at MIT, says that his analysis of Peace Corps documents obtained through the Freedom of Information Act shows that a drop-out rate of 30 percent or just above appears to have been fairly consistent for the past 40 years.

Sheppard told ABC News that no matter which measure is used, the drop-out rate actually peaked in the late 60s, when the numbers of applicants and accepted volunteers hit record highs. By 1968, almost two-thirds of volunteers were leaving the Peace Corps before their commitment was up.

In a June 2010 report, after using the annual drop-out measure for many years in its public statements, the Peace Corps also included an "early termination rate," the same measure Sheppard uses. For volunteers who started their service in fiscal year 2007, the early termination rate was 30.6 percent.

Peace Corps Deputy Director Carrie Hessler-Radelet told ABC News that the Peace Corps responds to signs of trouble. "When we see that there's a country where there's lots of people leaving, we do an investigation," said Hessler-Radelet, "because we imagine that there's something going on there, absolutely."

Hessler said the annual rate varies from nine to 12 percent, and that the Peace Corps is striving to get it lower, but, "You know, it's never going to be zero. ... There are some people who get over there and find out it's not for them."

Peace Corps Whistleblowers

Whether volunteers stay or go, said Ludlam, he is concerned about what he calls a reluctance on the part of the Peace Corps to listen to volunteers and their critiques of what works and what does not in a given country. He also says that volunteers must feel free to speak their minds in confidence in order for the Peace Corps to improve.

"If the program is poorly managed, the Peace Corps will threaten to send you home if you cause trouble. If you don't give the volunteers confidentiality, many of the young volunteers will not speak out," said Ludlam.

He argued that volunteers should have full whistleblower rights, like those given to government employees, and that their whistleblower status must be mandated by law in order to protect them.

Ludlam gave the example of Kate Puzey of Atlanta, a volunteer in Benin, West Africa who sent an email to her country director in 2009 saying that she believed a Peace Corps employee in her village was sexually molesting female students.

As detailed in an ABC News investigation that aired on "20/20", Kate was murdered two weeks after she sent the email. The prime suspect is the former Peace Corps employee she complained about, whose brother worked in the office of the country director.

"Kate was a hero. This was a courageous thing to do," said Ludlam. "It turned out to be a naive thing to do." Ludlam charged that the Peace Corps "blew her cover as a whistleblower."

The Peace Corps declined to comment on the Puzey case to ABC News, citing the ongoing criminal investigation in Benin, but Peace Corps director Aaron Williams issued an apology to the Puzey family after the "20/20" report aired, saying he was sorry if the family felt the agency had not been helpful after Kate's death.

Puzey's Family Wants Bill to Protect Peace Corps Volunteers

Puzey's family hopes Congress will pass a Kate Puzey bill, giving whistleblower protection to volunteers.They say they feel Kate's confidentiality should have been protected, and that it could have saved her life.

"We want Kate's legacy to stand for something so no family has to go through what we have," said David Puzey, Kate's brother.

Senator Chris Dodd, D-Connecticut, a former Peace Corps volunteer, introduced a bill that would have given whistleblower rights to volunteers in 2007, but Peace Corps vehemently opposed it and the bill died.

After Puzey's death in 2009, Dodd and Senator Johnny Isakson, R-Georgia, tried again with a new bill, which was introduced but is now in limbo. Dodd retired from the Senate earlier this month.

Isakson told ABC News that he is doing everything he can to see it through. The current language, he says, does not include "whistleblower rights," but it does have a provision for a secure mechanism for volunteers to report any issue "up chain of command."

Asked about whistleblower status for volunteers, the Peace Corps' Hessler-Radelet told ABC News prior to the 20/20 report that volunteers were not federal employees. "There are some technicalities that are difficult," she said. Only federal employees are entitled to whistleblower protection under current law.

But Hessler-Radelet said that if Congress were to pass a law giving volunteers whistleblower rights the Peace Corps would follow the law.

"If this legislation is passed, we'd be happy to work with [Congress], absolutely," she said. "In general we are very supportive of volunteers being protected under the law."

"I believe Peace Corps is still America's best idea and that Peace Corps is a great institution, that we care deeply about our volunteers and that we will do our best to support them," she said.

"It doesn't mean everything's perfect," said Hessler-Radelet. "We're continually striving for excellence. And we have -- you know, there's always things we could do better, absolutely, without question. I'm willing to take responsibility for anything that we need to in order to improve."